Field Landman Question of the Month: Term Mineral Interests

May 2014 – ArticlesThe Rocky Mountain LandmanBy Brent D. Chicken

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Term Mineral Interests Generally

Although mineral interests are typically conveyed in fee, they may also be conveyed or reserved for a specified period of time. Such conveyances or reservations are typically referred to as term mineral interests. When a grantor reserves a term mineral interest, the mineral interest will revert to the grantee upon the expiration of the specified term. During this specified term, the interest held by the grantee is often referred to as a reversionary future interest.

Although there is no Colorado jurisprudence that directly addresses term mineral interests and the issues surrounding the leasing of the same, such issues have been analyzed in other jurisdictions having substantial bodies of oil and gas law. A majority of states have generally concluded that the holder of a term mineral interest can execute an oil and gas lease, but its validity beyond the expiration date of the specified term is first controlled by the type of term mineral interest that has been created.